Paul McLaren holds the following portfolio: Stock Investment Beta A B D $150,000 1.40 -0.286 Total $375.000 -0.260 -0.234 50,000 0.80 O-0.190 100,000 1.00 Paul plans to sell Stock A and replace it with Stock E, which has a beta of 0.75. By how much will the portfolio beta change? -0.211 75.000 1.20

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Paul McLaren holds the following portfolio:
Stock Investment Beta
A
B
C
D
$150,000 1.40
O-0.286
Total $375.000
-0.260
-0.234
50,000 0.80
Paul plans to sell Stock A and replace it with Stock E, which has a beta of 0.75. By how much will the portfolio beta change?
O-0.190
100,000 1.00
-0.211
75.000
1.20
Transcribed Image Text:Paul McLaren holds the following portfolio: Stock Investment Beta A B C D $150,000 1.40 O-0.286 Total $375.000 -0.260 -0.234 50,000 0.80 Paul plans to sell Stock A and replace it with Stock E, which has a beta of 0.75. By how much will the portfolio beta change? O-0.190 100,000 1.00 -0.211 75.000 1.20
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